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New Mexico Chemical Corp., and El Morro Valley Land Co. Some of
these entities were S corporations; others were C corporations.
Petitioner filed with the State of New Mexico a statement of
intent to dissolve some of these entities. Petitioner did not
timely file Federal corporate income tax returns for some of the
entities even though she was aware of her obligation to do so.
Request To Grant Spirit Horse Ranch S Corporation Status
Retroactively
On December 21, 1996, petitioner's accountant wrote the
Internal Revenue Service Center (IRS) in Austin, Texas, requesting
the IRS to validate Spirit Horse Ranch's invalid S corporation
election for tax year 1986 forward, or in the alternative to
validate the election for tax year 1990 forward. In pertinent
part, the letter states:
We have been engaged to file certain past due income tax
returns for Janet D. Reed and to file certain past due
income tax returns for corporations owned by her
including Spirit Horse Ranch, Inc. In the course of
reviewing and reconstructing the past financial records
of Spirit Horse Ranch, Inc. and from discussions with Ms.
Reed concerning her intent for the corporation, it has
been determined that Spirit Horse Ranch, Inc. should have
been operated as an S Corporation. Under the new
provisions of IRS Section 1362 referenced above, we are
requesting that the IRS validate the S Corporation
election for Spirit Horse Ranch, Inc. effective for the
corporation's initial tax year of December 31, 1986 and
for all years since that first year. We feel that there
is reasonable cause to allow this validation of election.
* * * * * * *
Based on a review of the corporate records it is unclear
as to whether this Form 2553 was ever filed with the IRS
or whether any acknowledgment of the S Corporation status
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